Azerbaijan: Second Road Network Development Investment Program - Tranche 1

Sovereign Project | 45389-002 Status: Active


ADB is helping Azerbaijan with road upgrades along a route running from its border with the Russian Federation down to the border with Iran. The first project under the multitranche financing facility will fund a 30-kilometer section between Masalli and Jalilabad and support project implementation.  The project will boost trade and improve access to services for poor rural communities.

Latest Project Documents

Consulting Notices See also: CMS

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Procurement Notices See also: Operational Procurement

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Procurement Documents

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Project Name Second Road Network Development Investment Program - Tranche 1
Project Number 45389-002
Country Azerbaijan
Project Status Active
Project Type / Modality of Assistance Loan
Source of Funding / Amount
Loan 2921-AZE: Second Road Network Development Investment Program - Tranche 1
Ordinary capital resources US$ 250.00 million
Strategic Agendas Inclusive economic growth
Regional integration
Drivers of Change Private sector development
Sector / Subsector

Transport - Road transport (non-urban)

Gender Equity and Mainstreaming Some gender elements
Project Rationale and Linkage to Country/Regional Strategy

Project Outcome

Description of Outcome
Progress Toward Outcome Last review mission was fielded in October 2015. All contracts have been awarded. Overall, the project remains on track in the context of achieving the project outputs and outcome provided current pace of work progress continues
Implementation Progress
Description of Project Outputs
Status of Implementation Progress (Outputs, Activities, and Issues)

Civil works contract was signed on 11 December 2013. Overall physical progress was 49.2% as of end February 2016. Progress for past months was slow due to unfavorable weather conditions but is expected to improve as the contractor will commence pavement activities by April 2016. The Oct 2015 review mission considered it unlikely that the contract can be fully completed in 2016 in view of a potential variation which envisages some additional earthwork.

Consultants' contracts were signed on 28 December 2013. The construction supervision and program management consultants continues to provide services to support the PIU/ARS.

Geographical Location Masalli-Shorsulu Road

Safeguard Categories

Environment A
Involuntary Resettlement A
Indigenous Peoples C

Summary of Environmental and Social Aspects

Environmental Aspects An environment assessment and review framework20 for the investment program was prepared following ADB's Safeguard Policy Statement (2009) and relevant laws and regulations in Azerbaijan. The proposed motorway is on a new alignment with a 7 km section passing through wetlands. The sections to be financed by tranche 1 and 2 are classified as environment category A. The environmental impact assessment (EIA) reports were prepared in 2007; the World Bank in 2011 prepared an addendum that looked more closely into the wetlands and its environmental implications. Based on these reports, a single updated EIA was prepared that reflects compliance with the requirements of ADB's Safeguard Policy Statement. The EIA recommends specific mitigation measures with regard to motorway design and construction and a robust long-term monitoring program. The contracts for the supervision consultant, program management consultant, and civil works will include stringent provisions for compliance with environmental safeguards. An ecological expert and environmental specialist will be engaged to ensure implementation of the environmental management plan. Assurances to mitigate potential harm to the wetlands are also included in the loan agreement, framework financing agreement, and facility administration manual.
Involuntary Resettlement A resettlement framework for the investment program was prepared following ADB's Safeguard Policy Statement and relevant laws and regulations in Azerbaijan, and adopting the rehabilitation strategy in the resettlement policy framework. LAR activities were substantially completed based on the World Bank's resettlement plan, which the government agreed upon under the earlier World Bank-assisted highway project. A due diligence assessment confirmed that compensation payments were made following the resettlement policy framework agreed upon with the World Bank and are consistent with the requirements of ADB's Safeguard Policy Statement. Outstanding LAR activities include compensating the remaining 2% (15 privately owned plots) of households losing portions of their agricultural lands, paying compensation for affected municipal land, and providing additional rehabilitation assistance for severely affected and vulnerable households by prioritizing them for civil works jobs. Tranche 1 is classified as category A for involuntary resettlement. For tranche 1, a land acquisition and resettlement plan was prepared to cover the remaining LAR activities, including rehabilitation measures and actions to address temporary impacts and emerging LAR issues during implementation. Both the LAR framework and plan were disclosed on the ADB website on 23 July 2012. Implementation of the LAR plan will be monitored internally and externally. The program management consultant will conduct refresher training for the land acquisition department of ARS and respective district administrative staff on safeguards, and will monitor LAR-related activities.
Indigenous Peoples The investment program area does not have any known social or cultural groups classified as indigenous peoples under ADB's Safeguard Policy Statement. Tranche 1 is classified as category C for indigenous peoples impact.
Stakeholder Communication, Participation, and Consultation
During Project Design Public consultation were undertaken with communities, government and non-governmental organisations (NGOs) in relation to the construction of the road. Most feedback received from communities related to land compensation and access matters with little comment on environmental issues. At a meeting with environmental NGOs and local biodiversity experts some concerns were expressed over potential impacts on wetland ecology and a number of design mitigation measures were agreed to be considered.
During Project Implementation Consultation will be conducted during project implementation, when required.

Business Opportunities

Consulting Services Consultant recruitment financed will follow ADB's Guidelines on the Use of Consultants (2013, as amended from time to time).
Procurement Procurement of goods and works will follow ADB's Procurement Guidelines (2013, as amended from time to time).

Responsible Staff

Responsible ADB Officer Zheng Wu
Responsible ADB Department Central and West Asia Department
Responsible ADB Division Transport and Communications Division, CWRD
Executing Agencies
Ministry of Transport
1054, Tbilisi Avenue
Baku, AZ1122
Republic of Azerbaijan


Concept Clearance -
Fact Finding -
MRM 24 Jul 2012
Approval -
Last Review Mission -
Last PDS Update 31 Mar 2016

Loan 2921-AZE

Approval Signing Date Effectivity Date Closing
Original Revised Actual
25 Oct 2012 22 Apr 2013 30 Jul 2013 31 Dec 2016 31 Jan 2018 -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 312.00 Cumulative Contract Awards
ADB 250.00 25 Oct 2012 133.70 0.00 53%
Counterpart 62.00 Cumulative Disbursements
Cofinancing 0.00 25 Oct 2012 96.45 0.00 39%

Safeguard Documents See also: Safeguards

Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.

Evaluation Documents See also: Independent Evaluation

None currently available.

Related Publications

None currently available.

The Public Communications Policy (PCP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.

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